CALGARY,
AB, July 31, 2023 /PRNewswire/ - Canadian
Pacific Kansas City (TSX: CP) (NYSE: CP) (CPKC) today published its
2023-2024 Grain Service Outlook Report, which outlines the
company's plan to safely and reliably transport Canada's grain crop for export to
international markets.
"As we look toward the upcoming 2023-2024 crop year, CPKC is
once again well prepared to move Canada's grain crop to market, just as we have
throughout our 142-year history," said Keith Creel, CPKC President and CEO. "We have
the capacity and the team to deliver for our grain customers and
the Canadian economy during the upcoming crop year."
The report outlines CPKC's strong commitment to our grain
customers and unique position to supply rail transportation to
Canada's agricultural sector as
the first transnational railway that provides a single-line
connection between Canada, the
U.S. and Mexico. This powerful new
rail network provides Canada's
grain shippers with access to markets across North America, including many new markets in
Mexico, and enhanced routing
options for shipping Canadian grain and grain products overseas.
Additionally, CPKC has completed its more than $500 million investment to purchase 5,900 new
higher-capacity grain hopper cars.
Notwithstanding CPKC's robust preparation and investments, there
are several factors constraining Canada's export-driven grain supply chain,
including:
- The recent strikes at port terminals across B.C., including at
the Port of Vancouver, Canada's
largest port, once again demonstrated the damaging and compounding
impact of labour disruptions on supply chains. The prolonged
duration of the strike means that supply chain recovery will
stretch into 2024, potentially impacting grain transportation this
fall.
- The federal government's commitment to introduce legislation
prohibiting replacement workers by the end of 2023 would lead to
even more frequent and longer labour disruptions at Canada's railways and ports.
- The persistent challenge of loading grain onto vessels during
periods of rain or snow in Vancouver must be resolved to maximize supply
chain capacity and reliability.
- The government's decision to resurrect
extended interswitching on the prairies risks undermining rail
efficiency and capacity. This policy incentivizes inefficiencies,
causing higher transportation costs for all users of the rail
network, and drives Canadian investment dollars and jobs to the
U.S.
- Low demand for Canadian grain transportation at certain times
during the 2022-2023 crop year, and in particular throughout the
spring period, resulted in significant unused capacity
on CPKC's rail network, undermining Canada's ability to maximize grain exports to
global markets. Maximizing Canada's grain exports requires customers to
use the available supply chain capacity throughout the entirety of
the crop year.
Despite these avoidable headwinds, CPKC has the capacity and the
team to deliver for grain customers during the 2023-2024 crop year.
To read the full report, please visit cpkcr.com.
Forward-looking information
This news release contains certain forward-looking information
and forward-looking statements (collectively, "forward-looking
information") within the meaning of applicable securities laws in
both the U.S. and Canada.
Forward-looking information includes, but is not limited to,
statements concerning expectations, beliefs, plans, goals,
objectives, assumptions and statements about possible future
events, conditions, and results of operations or performance.
Forward-looking information may contain statements with words or
headings such as "financial expectations", "key assumptions",
"anticipate", "believe", "expect", "plan", "will", "outlook",
"guidance", "should" or similar words suggesting future outcomes.
This news release contains forward-looking information relating,
but not limited, to statements concerning CPKC's ability to
transport grain during the 2023-2024 crop year, the success of our
business, the realization of anticipated benefits and synergies of
the CP-KCS combination, and the opportunities arising therefrom,
our operations, priorities and plans, business prospects and demand
for our services and growth opportunities.
The forward-looking information in this news release is based on
current expectations, estimates, projections and assumptions,
having regard to CPKC's experience and its perception of historical
trends, and may include, among others, expectations, estimates,
projections and assumptions relating to: changes in business
strategies, North American and global economic growth and
conditions; commodity demand growth; sustainable industrial and
agricultural production; commodity prices and interest rates;
performance of our assets and equipment; sufficiency of our
budgeted capital expenditures in carrying out our business plan;
geopolitical conditions, applicable laws, regulations and
government policies; the availability and cost of labour, services
and infrastructure; the satisfaction by third parties of their
obligations to CPKC; and carbon markets, evolving sustainability
strategies, and scientific or technological developments. Although
CPKC believes the expectations, estimates, projections and
assumptions reflected in the forward-looking information presented
herein are reasonable as of the date hereof, there can be no
assurance that they will prove to be correct. Current conditions,
economic and otherwise, render assumptions, although reasonable
when made, subject to greater uncertainty.
Undue reliance should not be placed on forward-looking
information as actual results may differ materially from those
expressed or implied by forward-looking information. By its nature,
CPKC's forward-looking information involves inherent risks and
uncertainties that could cause actual results to differ materially
from the forward-looking information, including, but not limited
to, the following factors: changes in business strategies and
strategic opportunities; general Canadian, U.S., Mexican and global
social, economic, political, credit and business conditions; risks
associated with agricultural production such as weather conditions
and insect populations; the availability and price of energy
commodities; the effects of competition and pricing pressures,
including competition from other rail carriers, trucking companies
and maritime shippers in Canada,
the U.S. and Mexico; North
American and global economic growth and conditions; industry
capacity; shifts in market demand; changes in commodity prices and
commodity demand; uncertainty surrounding timing and volumes of
commodities being shipped via CPKC; inflation; geopolitical
instability; changes in laws, regulations and government policies,
including regulation of rates; changes in taxes and tax rates;
potential increases in maintenance and operating costs; changes in
fuel prices; disruption in fuel supplies; uncertainties of
investigations, proceedings or other types of claims and
litigation; compliance with environmental regulations; labour
disputes including the impact of the port workers' strike and
resolution of the strike in British
Columbia; changes in labour costs and labour difficulties;
risks and liabilities arising from derailments; transportation of
dangerous goods; timing of completion of capital and maintenance
projects; sufficiency of budgeted capital expenditures in carrying
out business plans; services and infrastructure; the satisfaction
by third parties of their obligations; currency and interest rate
fluctuations; exchange rates; effects of changes in market
conditions and discount rates on the financial position of pension
plans and investments; trade restrictions or other changes to
international trade arrangements; the effects of current and future
multinational trade agreements on the level of trade among
Canada, the U.S. and Mexico; climate change and the market and
regulatory responses to climate change; anticipated in-service
dates; success of hedging activities; operational performance and
reliability; customer, regulatory and other stakeholder approvals
and support; regulatory and legislative decisions and actions; the
adverse impact of any termination or revocation by the Mexican
government of Kansas City Southern de México, S.A. de C.V.'s
Concession; public opinion; various events that could disrupt
operations, including severe weather, such as droughts, floods,
avalanches and earthquakes, and cybersecurity attacks, as well as
security threats and governmental response to them, and
technological changes; acts of terrorism, war or other acts of
violence or crime or risk of such activities; insurance coverage
limitations; material adverse changes in economic and industry
conditions, including the availability of short and long-term
financing; the pandemic created by the outbreak of COVID-19 and its
variants and resulting effects on economic conditions, the demand
environment for logistics requirements and energy prices,
restrictions imposed by public health authorities or governments,
fiscal and monetary policy responses by governments and financial
institutions, and disruptions to global supply chains; the
realization of anticipated benefits and synergies of the CP-KCS
transaction and the timing thereof; the satisfaction of the
conditions imposed by the U.S. Surface Transportation Board in its
March 15, 2023 final decision; the
success of integration plans for KCS; other disruptions arising
from the CP-KCS integration; estimated future dividends; financial
strength and flexibility; debt and equity market conditions,
including the ability to access capital markets on favourable terms
or at all; cost of debt and equity capital; improvement in data
collection and measuring systems; industry-driven changes to
methodologies; and the ability of the management of CPKC to execute
key priorities, including those in connection with the CP-KCS
transaction.
The foregoing list of factors is not exhaustive. These and other
factors are detailed from time to time in reports filed by CPKC
with securities regulators in Canada and the
United States. Reference should be made to "Item 1A – Risk
Factors" and "Item 7 – Management's Discussion and Analysis of
Financial Condition and Results of Operations – Forward Looking
Statements" in CPKC's annual and interim reports on Form 10-K and
10-Q.
Any forward-looking information contained in this news release
is made as of the date hereof. Except as required by law, CPKC
undertakes no obligation to update publicly or otherwise revise any
forward-looking information, or the foregoing assumptions and risks
affecting such forward-looking information, whether as a result of
new information, future events or otherwise.
About CPKC
With its global headquarters in Calgary, Alta., Canada, CPKC is the first and only single-line
transnational railway linking Canada, the United
States and México, with unrivaled access to major ports from
Vancouver to Atlantic Canada to the Gulf of México to
Lázaro Cárdenas, México. Stretching approximately 20,000 route
miles and employing 20,000 railroaders, CPKC provides North
American customers unparalleled rail service and network reach to
key markets across the continent. CPKC is growing with its
customers, offering a suite of freight transportation services,
logistics solutions and supply chain expertise. Visit cpkcr.com to
learn more about the rail advantages of CPKC. CP-IR
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SOURCE CPKC
